A couple of weeks ago, Briana from Go Banking Rates asked me what it was like to raise a family on a single income. Since then, two other people have asked me the same question. Living on a single income is a choice that dramatically affects a family’s finances. So, I thought I would explain the reasons for our choice and the consequences that came with that decision.
There is no Perfect Choice
Whether couples choose to both work for a higher income or have someone stay at home to take care of the kids, there seems to be a lot of guilt that comes with that decision. The choice is really as simple time vs. money for your family. But, the effects on finances and lifestyle are anything but simple. Most of the parents I talk to are wondering if they made the right decision to work or stay at home. There is no guaranteed right answer, either way.
I had very personal reasons for choosing a traditional family lifestyle. When I was young, my Mom stayed at home and took care of us. Then, she took a part-time job to help out and she was gone more often. After my parents divorced, my Mom worked full-time while putting herself through college. So, I saw three different family situations and I knew all about the sacrifices involved.
When we decided to get married, I envisioned working together as a team. I wanted to divide up the work load and conquer what we were each best at. My wife and I are both from big families and our family is our main priority. We wanted to be successful, have a nice lifestyle and provide opportunities for our children, just like any family. But, we didn’t want our kids coming home to an empty house after school let out. We wanted to be more involved with their lives and to influence them to make good decisions.
Supporting a family today costs a lot of money. And, unless someone has a very high salary, raising kids on a single income will require sacrifices in their standard of living. The loss of a second income is partially offset by lower taxes, work-related costs and child care expenses. But, there is definitely a drop in discretionary income and that can limit some of your options.
When we were starting out and my paycheck was very small, the reality of living on a single income was brutal. We only had one car and could barely keep milk in the fridge. Any small emergency clobbered our budget and ratcheted up our credit card balance. Another problem was that we live in a very expensive area. Even though our rent was cheap at the time, the cost to buy a house was way out of our reach. We had all the basics covered, but there wasn’t any money for fun or entertainment.
A couple of stressful things happened to our relationship, soon after getting married. First, I began to resent my wife for being at home all day, while I worked long hours and weekends to pay our bills. And, I resented the fact that we were still broke, even though I was working so hard to get ahead. Even worse, my wife started to complain about how all our friends had nicer cars and apartments than us. This wasn’t fair to me, because most of our friends were dual income and the wives were working to pay for those new cars.
The absolute low-point for me was when we had a house fall out of escrow. The loan agent was shocked my wife didn’t work and we couldn’t qualify for a loan on my income alone. As we were unpacking our dishes and putting them back away in our apartment, my wife said something devastating. She said, “We’ll never get a house. You don’t know what you are doing. You are just acting like we’ll get a house because you are too cheap to spend any money.” After saving for a house for almost ten years, it was the last thing I wanted to hear.
Making it Happen
After losing our escrow deposit and getting chewed out by my wife, I sat down in a moment of self-pity and dreamed about what it would be like if we had more money. I thought about all of our plans and goals and I wondered why we were failing to reach them. To the best of my abilities, I had done everything right. I had worked hard, saved carefully and kept our expenses low. I knew we were on the right path financially, but our goals seemed farther away than ever.
After a couple of hours going over everything in my mind, I came to a very unpleasant realization. I was the sole cause of our failure. We had chosen to live on a single income and it was my job to earn it. Yet, I was concentrating all of my energy on scrimping and saving. Soon after I realized this, I had a much more pleasant thought. If I could increase our income to an acceptable wage, it would speed up the realization of all our goals. And, it was up to me alone to step up and make it happen. So, increasing our income became my new goal and it happened faster than I could have imagined.
Two years later, we finally got our house. It was a nice two-story house a couple of blocks from the beach. Our friends seemed surprised we were able to afford the house. They had seen us struggling to make ends meet, not realizing we were saving a lot of our income. Most important, my wife gained a lot of confidence in me and my ability to make things happen. Even though there were still plenty of tough times ahead, this was the beginning of a more prosperous life for us. And, the rest of our goals seemed a lot closer.
Our kids are grown up now and our daughter will turn 18 in just a couple of months. So, our legal responsibility as parents and control of our children’s lives is coming to an end. Soon, they will be out on their own and struggling to pay their own bills. We will never have to look back and wonder if we could have done more for our kids by having a second income, because money and material comfort weren’t that important. It was the time we spent and the example we set of working hard to achieve a comfortable life.
The other half of the story was the impact this choice had on me. There’s no question in my mind that I wouldn’t have worked nearly as hard, if I didn’t have the unrelenting pressures of providing for the entire family. I probably would have worked just hard enough to get by and cruise through life. All of the years of night school, the side jobs and working weekends, were for my family. So, my family is a big part of the reason I became successful.
The Bottom Line
The bottom line is that there’s no single choice that’s right for everyone and someone else’s choice may not be right for you. So, choose what you feel is best for your family. Then, don’t waste a single minute feeling guilty.
“No matter what you’ve done for yourself or for humanity, if you can’t look back on having given love and attention to your own family, what have you really accomplished?”
Elbert Hubbard – American Author
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This post was featured on the Carnival of Personal Finance over at Consumerism Commentary. If you aren’t familiar with the Carnival of Personal Finance, you need to check it out. It’s the premiere carnival for Finance Blogs.